My Story of Internet Fraud and Scams
When I got the email from a woman named Helen Smith saying that she would like to sublease my apartment for the full cost, I was ecstatic. I’m short on money to begin with, and after graduation I was hoping to cut my costs by finding someone to sublet. I was so excited that my judgment was probably a little clouded âÂ?¦ well, I guess I was completely blinded. Ms. Smith informed me that she would be coming to Bloomington to attend a meeting, and that her sponsors would be funding her trip. She said that they would send me a check for $4000, and that the excess money would be to cover her travel expenses. I was to send the money via Western Union. I was a bit skeptical; it all seemed a little too good to be true. But getting my expenses covered? I was way too excited. When I received the check in the mail, I deposited it. Three days later, the check appeared to have cleared and the money was deposited into my bank account. Feeling that everything was free and clear, I then withdrew $2700 and sent it Western Union to my supposed- Ms. Smith. I was very excited that everything had come through. I paid my rent for the summer with money and even went out and bought myself a band new Trek 1000 road bike. I could hardly believe my luck âÂ?¦ I should have been far more skeptical.
I discovered a week later that the bank had found the check to be fraudulent. They took the $4000 back out of my account to cover their expense. This would all be fine, if it weren’t for the fact that I had a) spent some of the money and b) I had withdrawn over half of it and sent it Western Union to the person who I would come to know as my very own personal criminaloid. So now my bank account is in the negative $3,686 and I have no way to cover it. I have a meeting with the bank tomorrow to find out what my next course of action is, but the most likely scenario is that I will have to take out a loan to pay back the bank and then work all summer to pay back that loan. Not to mention the fact that I still have summer living expenses, no subleaser, and $14,000 in student loans that I have to begin paying back in six monthsâÂ?¦ oy vey.
As I sit here and write down what has happened to me, I realize how stupid I sound. Understand that I feel absolutely ridiculous. I should have realized it was too good to be true. I should have noticed the scam. In this situation, hindsight is 20/2000. I feel absolutely robbed (and I was). When I began researching the scam on the Internet, I realized how common it was. Hundreds of people have been taken, but this is not comforting to me. I have always considered myself a smart person; someone not easily taken to the cleaners. I have an $80,000 education, goddamnit!
So now where am I? I am two weeks from college graduation trying to focus on finals and papers with the weight of all this on my mind. I was originally planning on writing my final paper for J300 on the experience of the people who write protest music. But as I sat down to try and focus on Dylan and Guthrie, I began to cry for about the six hundredth time this weekend. I am so weighed down and full of emotion over this. What else am I to do but use this emotion to truly capture the experience of trying to learn and rationalize what has happened to me and also get it down on paper. I’ve changed my topic for the paper because right now, it’s difficult for me to think of anything other than this. I figured I ought to get some mileage out of this if I’m going to be scammed out of my hard earned money. If I’m going to lose $4000, maybe I can at least get an A on a final paper. But it’s not just that. I’m writing this for my own edification, to try and find some kind of peace with this whole incident. Writing has always been my therapy. It’s the way I put myself out into the world and see my thoughts manifest themselves. It’s how I understand myself and everything that is going on around me. So why not apply my skills to this, the worst thing that’s ever happened in my life? I can learn what happened to me and attempt to understand it. And maybe my research can even serve as a warning to other people who may be victims of this scam.
I think a good place to start when trying to understand this experience is James Allsworth Ross and his essay “Sin and Society.” Ross begins his essay with a discussion on just what sin is and what it is becoming in society. No longer is bloodletting and physical pain the only kind of sin. “The sinful heart is ever the same,” James writes, “but sin changes its quality as society develops.” As Ross wrote these words, he was thinking of corporations, the stock exchange, and government institutions. He could have no way of knowing that a century later nameless, faceless criminals would be able to steal thousands of dollars from innocent citizens simply by preying on their use of technology and their inherent trust in people. “But the tropical belt of sin we are sweeping into is largely impersonal. Our iniquity is wireless, and we know not whose withers are wrung by it. The hurt passes into that vague mass, the ‘public,’ and is there lost to view.”
If only James knew just how right he was. Wireless? I sent my money off into the wild blue yonder based on an email from someone I had never spoken to. Ross’s words are so resonant because be wrote them in a time when he could not have imagined the existence of computers, much less the Internet. I think his insight on the Internet and its implications from criminal activity would be amazing. And while Ross does not address technology directly (he couldn’t), his essay absolutely applies to computer and Internet fraud. When reading it, in fact, it is difficult to believe that Ross didn’t have Internet fraud in mind as he wrote “Sin and Society.” For example, Ross writes, “Commerce tempts the pirate, the forger, and the embezzler. Every new fiduciary relation is a fresh opportunity for breach of trust.” I was reading on a website regarding this type of fraud, that the greatest problem for law enforcement is that once they sew up one loophole, these criminals simply find another way to exploit their victims. Technology moves so quickly, and as it grows, so too do criminal enterprises. In 2000, the number of online users topped 200 million and continues to grow exponentially.
Usership of the Internet is nearly incalculable today. The scale on which the Internet is used and the dependence upon it for daily life would certainly frighten anyone writing about white collar crime in 1907. Ross was right in identifying that a criminal in today’s society would exploit any means possible and continue utilizing new technology to find new ways to fleece the public.
When reading “Sin and Society,” it is also necessary to understand Ross’s audience. He wasn’t just writing his essay as a description of what society is: his intention was to prevent this kind of crime. He was writing at a time when he could see what no one else seemed to realize and Ross wanted to use this insight to help possible victims. His audience was the unwitting public who was entrusting their lives every day to these criminaloids. His audience was me. “The sinister opportunities presented in this webbed social life have been seized unhesitatingly,” Ross writes, “because such treasons have not yet become infamous.”
Ross wanted “Sin and Society” to act as a billboard warning of this type of crime. He wanted his essay to bring fame to this “treason,” as he calls it. It was Ross’s discussion of trial by newspaper that incited me to file complaints and begin writing letters. There’s nothing I can do now about my $4000, but there is certainly something I can do to save someone else’s bank account. It would be easy for me to accept my situation, resign myself to a few months of debt, and move on. But as Martin Luther King wrote, “I cannot sit idly by in Atlanta and not be concerned about what happens in Birmingham. Injustice anywhere is a threat to justice everywhere.” Even the detective at the Bloomington Police Department who is handling my case would agree. When I spoke with him, he informed me that “It may be embarrassing, but the best thing you can do is tell everyone you know about this.
The scammers can only work if people are there to be at their mercy. You can help people be smarter and stop these scammers.” I was inspired by Ross’s essay in this was; such is the power of great writing. For people who have laughed at me for writing this paper on Internet Fraud instead of protest music, I say to them that what is writing if does not (as we discussed in class) add to human wisdom? If even one person stops and thinks before they fall prey to these criminals because of my paper or Ross’s essay, then I have spent my time far better than if I had analyzed lyrics to a Woody Guthrie song.
If Ross’s message is that of awareness, then it is important not just to share my story, but the story of the crime as a whole. Certainly I am not the first person to fall prey, and I certainly don’t want to be fooled again. I decided to take Ross’s message to heart and learn more. Telling my story is not enough. I began my research of Internet fraud for my own personal edification. I wanted to know that I wasn’t the only one that had been taken to the cleaners by these criminals. I used my favorite personal research tool, Google, and typed “Internet fraud.” The number of results was astronomical and dominated by government websites displaying either warnings against this type of fraud or information on what to do if you have been a victim. I thought the Internet Fraud department of the FBI would be a good place to start. The Federal Bureau of Investigation has partnered with West Virginia’s Internet Crime Complain Center to begin gathering, documenting, investigating, and prosecuting as many cases as possible of online fraud. The information I found there was both astonishing and a little comforting.
According to the Internet Crime Complaint Center’s (IC3) 2004 Internet-Crime Report, 190,143 complaints of Internet fraud were reported in 2004 totaling $68.14 million dollars combined loss to the victims. Complaints have been filed from all fifty states, in several countries, and have affected victims as young as ten years of age (26% of victims are between the ages of 20 and 29). Between 2002 and 2003, Internet fraud such as mine jumped from number nine to number three on the “Top 10 Internet Scams.” Check fraud and Nigerian letter fraud carry the highest dollar amount of loss to the victim, and this was a rough combination of the type of scam that had been perpetrated against me. The actual FBI classification of type of the fraud perpetrated against me, however, is called “confidence fraud.” It is fraud that requires a breach in a relationship of trust that results in a financial loss.
As I read this term in the IC3 report, my stomach dropped. I realized just how much my confidence had been attacked. My boyfriend tries to comfort me by saying I was defrauded because of my desire to trust in the good of man, and this is a characteristic I should be proud of. Yet now I feel robbed of this trust, of this confidence. While it may be good for my bank account, it sucks for my soul as I realize I have lost my faith in man. My rose-colored glasses have been ripped off my face to reveal the world as a sinister place where no one should be trusted. This is a hard lesson to learn, but perhaps a valuable one for someone beginning to make their way into the “real world” that we have talked about all semester.
I continued to read, however, and was increasingly comforted realizing that I am one of many unwitting victims, and that I had been taken for a lot less than some people by the very same scam. When I came to the end, however, my spirits began to sink. The “Prosecution” section was not as promising. The IC3 report contains several examples of cases that were investigated and prosecuted, however none of these had any international connection. This is because nearly 100% of cases involving international perpetrators are untraceable and thus unsolvable. “Inter-state and international boundaries are irrelevant to Internet criminals. Jurisdictional issues can enhance their criminal efforts by impeding investigations with multiple victims, multiple state/countries, and varying dollar losses.”
Similarly, many foreign countries from which this fraud originates (such as Nigeria), have no system of dealing with cyber fraud. Their government basically maintains a hands-off approach to this type of crime. It is exactly this information that the criminals exploit, much as Ross identified in his quote about how commerce tempts criminals, and every new fiduciary transaction is exploitable. In the report, 63% of perpetrators use e-mail as their primary contact method, and very often it is their only contact method. Using free Yahoo and Hotmail accounts, the IP addresses are thus untraceable, as are the actual originators of the addresses. The FBI also addressed the issue of e-mail fraud, saying, “one of the components of fraud committed via the Internet that makes investigation and prosecution difficult is that the offender and victim may be located anywhere worldwide. This is a unique characteristic not found with many other types of ‘traditional’ crime.” Unlike when a purse is snatched off someone’s arm in New York City, a victim can’t chase down their attacker. They can’t describe him, point to him, or even discern if the criminal is a “him.” This is the type of crime James described yet could hardly even imagine.
I believe the FBI must have a copy of “Sin and Society” by their computer as they compiled this report, because in thirty pages of tables, statistics, charts, and facts, I found a very interesting statement near the bottom: “It is recognized that consumers may characterize crime problems with an easier ‘broad’ character, which may be misleading.” This is the exact description of Ross’s “criminaloid.” The FBI is warning consumers that anyone can dress up as a businesswoman, a college student, a political prisoner, or your grandmother, all in an effort to gain confidence and then steal from you. And its not just young desperate people like me who get taken. “Anyone who utilized the Internet is susceptible,” the report warns, and urges people to simply use caution.
The Internet is not Mayberry. You have no idea who you are dealing with. When you are young in school, you are constantly warned of the strangers in the park. I even remember being warned of strangers in chat rooms on America Online. Yet when you come to college, every transaction is done on the computer. You pay your bills, register for classes, communicate with professors, line up internships, and yes, even find housing online. After four years of a digital lifestyle, it is easy to become desensitized to the people you come across online. If you’ve been doing it for this long and never been screwed, your guard tends to drop. But as my mother said when I told her, “Lauren, if a cocaine dealer walked up off the street and asked you to withdraw cash, would you do it?” When I told her of course not, she responded, “Well guess what? That’s exactly what you did.”
The report also listed preventative steps to avoid being scammed. The FBI and IC3 have partnered to aid in prevention by providing links to complaint forms on rental websites, online auction sites such as eBay, and any site involving money transfer. They also post warnings across the Internet relating to various scams being perpetrated. When I reached the section on confidence fraud, I half expected to read, “don’t be stupid” as their best means of advice. I was not disappointed. They simply said that in these instances it pays to be skeptical, i.e., always listen to your gut! Well I would like to add to this prevention. I would like to spread the word of these new criminaloids; I would like to bring this term back to the American lexicon. It is imperative that this information be disseminated so other unknowing college kids or businessmen don’t get swindled. I want my paper posted on the Internet and on government websites. Ross was right: awareness is the only form of prosecution. The thieves can’t steal if everyone knows their tricks.
So what happens now? Well, I am working on taking out a loan so I can pay back the bank. Then I will have to work my behind off to pay back the loan in six months before I have to start paying back my students loans. It is going to be a difficult situation, and as my dad explained, “It’s probably going to suck a lot.” But it’s a lesson that I learned. My dad informed me that adults get themselves out of their own messes, but adults also learn how to stay out of them in the first place. Soon it will all be over and it will be just another story I tell about the lessons I’ve learned on the rocky road of life. As I stood in my living room clutching my cell phone and sobbing hysterically after that fateful conversation with the bank, my roommate walked up behind me and hugged me.
“I know this isn’t a lot of comfort now,” Katie said, “but no one you know is sick, not one has died. In the end, its just money.”
Over the next few days I would hear that a lot, and as my situation began to sink in I realized my roommate, my mom, my dad, and my friends were right. It is just money. It could be so much worse. If this is the worst thing that ever happens to me, then I am very lucky. All I can do now is move forward. And perhaps writing this paper, getting this information out, is part of that step. Understanding and awareness are the best ways to learn and prevent.
